Housing Price Article (I'm Quoted) From Burbank Leader

This appeared in the Burbank Leader on 10/20/07. A disclaimer about the stats: I read these off the mls, and encouraged the reporter to check them with Dataquick, the data service for the real estate industry. I don't think he did. Even though this is for Burbank, it pretty much reflects what we're seeing all over L.A.
Housing prices take a fall
Average price of a single-family home in Burbank in September was $658,000, compared with $692,000 in August.
By Jeremy ObersteinBURBANK — The average price for a single-family home in Burbank dropped almost 5% from August to September, and the number of residences listed on the open market in the same period increased almost 50%, according to the National Assn. of Realtors.“There’s a decline, no doubt about it,” said Judy Graff, a broker in Burbank.The average asking price for a single-family home in August was about $692,000 and about $658,000 in September, she said.In August, 229 properties were listed on the open market, while 336 homes and condos were listed by Sept. 30, she said.Graff tied the decrease in housing prices and increase in homes for sale to the credit crunch by which many Americans have felt squeezed.
“There’s a credit crisis in this country,” she said. “Up to 40% of people who were able to get loans back in July can’t get loans anymore.”The robust housing market of the 1990s and early 2000s, in which potential home buyers could easily secure a loan, seem to be a distant memory, said Ken Fears, an economist with the National Assn. of Realtors.“The housing boom [lasted] from 1998 to spring 2005,” he said. “The housing market has been slowing down since then and, since July 2007, home sale prices have sharply decreased.”That has directly affected Burbank residents, Graff said.“It used to be that if you could fog a mirror, you could get a loan,” she said. “Now, lenders want to see a 10% down payment and excellent credit scores. If the median price of a single-family home is $700,000, you would need to have $70,000 sitting in the bank. How many young couples have that kind of money?”The decrease in sales can be tied to the fallout in the mortgage-backed securities market, which specifically affects Burbank, Fears said.“What hurts Burbank is the lack of financing in the jumbo market, defined as any loan over $417,000,” he said. “Mortgage-backed securities stopped buying jumbo market loans, driving prices up and causing more homes to be listed on the open market.”As a result of loan defaults, many homes are staying on the market longer than anticipated, Graff said.“We have 11 months’ worth of inventory on the market,” she said. “Homes are staying on the market for a much longer period of time. What it comes down to is, there are less transactions now.”However, Fears does not expect the damaged jumbo market to be down for too long, nor does he believe the credit crunch will drive a national recession.“In terms of the jumbo market, it could be back within months. I’m not too worried,” he said. “The underlying economy is doing very well. Now, the [lending problem] is caused by increased interest rates. It’s a good economic backdrop for this painful housing market.”The problem remains prevalent in Burbank but may not be an impediment to ownership for all, Burbank Assistant City Manager Mike Flad said.“Cost of housing is one of our largest obstacles,” he said. “But the cooling-off is a plus for some who can enter the market with lower prices.”
 JEREMY OBERSTEIN covers City Hall and public safety. He may be reached at (818) 637-3242 or by e-mail at jeremy.oberstein@latimes.com.